Community development finance is a broad term encompassing the varied sources of funding that support stronger and more resilient communities around the country. Community Development staff at the Federal Reserve promote new and established sources of community development finance for low- and moderate-income (LMI) communities by working closely with financial institutions, community development organizations, nonprofits, foundations, research and policy centers, and government agencies.
Financing community development investments in LMI communities often requires a creative mix of public, private, and philanthropic resources. The Federal Reserve helps community development organizations access the technical and financial resources required to complete these often-complex deals. The Federal Reserve also uses its research and convening capabilities to explore new and emerging sources of capital to support community development finance. In addition, the Federal Reserve, as a regulator of the Community Reinvestment Act (CRA), seeks to educate banks and community stakeholders about how to partner to direct CRA-eligible loans and investments in a manner that is most impactful for the local community.